Tuesday, November 30, 2010

Your Euro Debt Pr0n Post of the Day

Nov. 30 (Bloomberg) -- Spain’s banks may struggle to refinance about 85 billion euros ($111 billion) in debt next year as costs surge on concern continental Europe’s fourth- biggest economy may need an Irish-style bailout.

“There’s a universal dumping of Spain going on,” said Andrea Williams, who helps manage about 623 million pounds ($968 million), including shares in Banco Santander SA, at Royal London Asset Management. “The fear is that Portugal, Spain and Italy are now in line after what happened in Ireland.”
Freight train.

A Tiny Take On Wikileaks

Wikileaks is like a high school girl's very personal diary falling out of her backpack at school. In no time at all, everyone is pouring through it to see what she wrote about them. Every tiny criticism is blown out of proportion and the girl has to go into full-time damage control mode.

Elsewhere, Dean isn't impressed by the whole thing while Secular Apostate is less sanguine.

Monday, November 29, 2010

Cheezburger of the Day

Link of the Day

The Wall Street Journal has created a fantastic multimedia explanation of the European Debt Crisis' results. Check it out.

Keep in Mind, This Is Just the Beginning

Ireland is saved!* Now on to Portugal and Spain!
Nov. 29 (Bloomberg) -- The cost of insuring against default on Portuguese and Spanish government debt soared to record high levels as an aid package for Ireland failed to reassure investors the region’s debt crisis will be contained.

Credit-default swaps on Portugal jumped 36.5 basis points to 538.5, and contracts on Spain climbed 24.25 to 347, according to CMA...

“The market seems to think it’s inevitable Portugal requests assistance next -- perhaps in January? -- and then after that Spain will be scrutinized with a fine tooth comb over the coming months,” said Jim Reid, head of fundamental strategy at Deutsche Bank AG in London.
Just like the mammoth marital fight that occurs when you and your spouse come to the realization that having 5-digit balances on 6 different credit cards plus a mortgage plus two auto loans means that you're practically bankrupt, this is the part with all the yelling and jumping up and down. Once the screaming has stopped, the bills have to be paid. The real change will occur once priorities are reassessed and you have to live within your means while struggling to pay down those monstrous debts.

* - Well, at least until they realize they can't pay back a $113B loan.

Sunday, November 28, 2010

Iceland Teaches, the World Ignores

Lost amidst the sturm und drang of the European debt crisis is the story of tiny Iceland.
Nov. 26 (Bloomberg) -- Iceland’s President Olafur R. Grimsson said his country is better off than Ireland thanks to the government’s decision to allow the banks to fail two years ago and because the krona could be devalued.

“The difference is that in Iceland we allowed the banks to fail,” Grimsson said in an interview with Bloomberg Television’s Mark Barton today. “These were private banks and we didn’t pump money into them in order to keep them going; the state did not shoulder the responsibility of the failed private banks.”
This is the story of plenty of financial and fiscal crises before now and only Iceland seems to have it figured out. Lost amidst the wailing and grinding of teeth that this is the worst economy in (insert random number of decades here) is that human societies imploding from time to time is a natural consequence of the imperfections of humanity. In the past, the fastest recoveries have been the ones where the government didn't engage in massive interventions, FDR's endless, large-scale experimentation in the Great Depression included. This isn't just noise, the Iceland recovery is really happening. Unemployment in Iceland is less than 7% and their economy is starting to grow.

Michael Derks points out another unspoken truth in all of these bailouts - the debt problems are too big to rescue through nationalization.
“The taxpayer has no realistic prospect of being able to save their banks, such is the magnitude of their bad loans and their extraordinary dependence on central bank support,” wrote Michael Derks, chief strategist in London at foreign-exchange firm FXPro. “Both junior and senior bondholders in these insolvent banks need to suffer huge haircuts,” he said.
Meanwhile, closer to home, we nationalized GM, Chrysler, the entire home mortgage industry in the form of Fannie Mae and Freddie Mac ...

Bloomberg has disabled embedding, but here is a great interview with Olafur Grimsson. It's worth watching a national leader who gets it. Compare this to the serial statist spasms you see everywhere else.

Don't Panic About California Defaulting

... because it doesn't seem likely, given the state's constitution, writes Jamers Altucher in a column earlier this year.
The California constitution mandates that education costs be paid first out of any revenue coming in. California has about $90 billion in revenue. About 40% of that goes to education. After that, as per the California constitution, all debt payments have to be made. After that, California can spend on whatever it wants: police, landscaping, random buildings, etc. Debt service payments come to about $5.5 billion per year. In other words, each year California makes its debt payments, with an extra $50 billion to spare. This is why it has no problems refinancing and why municipal bond yields are at record lows. Most states have similar clauses in their state constitutions: that debt service payments come before anything else.
I know I'm a broken record on this, but it reinforces what I've been saying since the elections - Jerry Brown's victory was the high water mark for progressives. When California can't pay its bills, it doesn't default on its bonds, it whacks its services and employees. And who has the largest chunk of the slashable budget?

And the big winner is ... Health and Human Services! Let's hear a big round of applause for the unsustainable social programs!

In the comments of that article is this contrarian view:
As a investor, I have one simple question to ask - where is the money? Lets check - States like California are not independent countries like Greece - they are part of the US - so factor in Federal debt to the equation. State + Federal + muni debt. So where is the money to pay for all this debt? I expect a default. You can not tax people who do not have the money.
I don't see how this disproves the author's point. The bond servicing payments don't seem so large that the objection, "Where is the money" will ever come into play. With businesses leaving the state, there's no question that raising more taxes will prove to be fruitless, but that still doesn't lead to insolvency in terms of debt servicing. Insolvency will lead to an employee and benefits crisis instead, which is what we've been seeing with furloughs, mandatory days off without pay and the state issuing IOUs in lieu of benefits checks.

Saturday, November 27, 2010

Tromboncino Squash

... from my mother's garden, arrangement by my wife.

More info on Tromboncino squashes here.

Celebrating Caturday

I shot this one yesterday. I love the way the background is overexposed and blurred. It really sets off our Maximum Leader's regal face. The exposure on her fur was just right and you can see individual hairs if you click and look at the larger version. She's a bit dirty and rumpled as moments before she had been happily rolling around on the ground.

Surf Movie Saturday

We're going to see this one today. Can't wait.

Friday, November 26, 2010

And in Other News, You Can't Stop a Freight Train Quickly

From Bloomberg, with emphasis added by me.
Nov. 26 (Bloomberg) -- Borrowing costs for Europe’s most indebted nations are at record highs as Ireland’s capitulation in accepting a bailout of its banking industry stokes concern that other countries also will have to seek aid.

The average yield investors for 10-year debt from Greece, Ireland, Portugal, Spain and Italy reached 7.57 percent today, a euro-era record. The average premium investors demand to hold those securities instead of German bunds widened to as much as 492 basis points, the highest level of 2010. The average cost of insuring against default by the five nations using credit- default swaps reached a record 517 basis points on Nov. 23.
It's time for a Marc Faber encore.

You can't have the kind of debts (Greece, Portugal, Spain, Italy) has with (olive oil, sardine, tourism, lousy Italian cars) income. This is like a runaway freight train and the bondholders and European Central Bankers keep getting surprised every time the thing smashes through another flimsy barricade.

Jerry Brown's election as governor of California was the high water mark of the progressives across the Western world. This freight train of debt was started when we began making social spending promises we knew to be unsustainable and it picked up speed every time we launched another doomed-to-fail War on Poverty program.

It won't stop until many of those social spending programs have been dismantled, either deliberately through austerity measures, or involuntarily through the inflation that comes with printing money to pay for them.

Thursday, November 25, 2010

Happy Thanksgiving!

Thanksgiving as a holiday was begun by Abraham Lincoln with a proclamation that contained this passage:
No human counsel hath devised nor hath any mortal hand worked out these great things. They are the gracious gifts of the Most High God, who, while dealing with us in anger for our sins, hath nevertheless remembered mercy.

It has seemed to me fit and proper that they should be solemnly, reverently, and gratefully acknowledged, as with one heart and one voice, by the whole American people. I do therefore invite my fellow-citizens in every part of the United States, and also those who are in foreign lands, to set apart and observe the last Thursday of November next as a day of thanksgiving and praise to our beneficent Father who dwelleth in the heavens.
In the spirit of Honest Abe*, I'd like to say that I am deeply thankful that God has given me innumerable chances to recover and learn from mistakes and friends (which includes all y'all) and family who have shown me supportive kindness and understanding forgiveness throughout my life. God bless all of you.

* - Sometimes you can be a little too honest. :-)

Wednesday, November 24, 2010

Cheezburger of the Day

Arthur thought his annual moult was a little severe this year

In for a Dime, in for a Trillion

A thought occurred to me as I was reading a couple of articles about the European debt crisis yesterday. Right now, the European Central Bank (ECB) is printing money and loaning it to Greece and Ireland (soon to include Portugal and Spain) because these countries can't pay their bills without access to more loans. The ECB is holding interest rates low to make it easier on these borrowers, but the money is still borrowed and that debt still has to be serviced. What happens when (not if) they discover that, say, Portugal is insolvent?

Once you've printed the money and loaned it out, it's too late to get it back. Unlike loans from German and French banks, no one is going to immediately go under if the loans are simply forgiven and the money is effectively gifted to Portugal. If you aren't going to draw the line now and force bankruptcies and liquidations, what would make you do it a year from now when you've got so much more invested? Once you start down the road of printing money to cover government debts, where do you stop, particularly if the government you're lending to has no hope of ever paying it back?

This is the point Marc Faber has been making for quite some time - these nations are insolvent and will never be able to pay back these loans. The money quote starts at 0:30.

So once the ECB has bought up the debt and the commercial banks in Germany have quietly sold theirs off to the ECB, the only one taking the hit when you finally forgive the debts of Portugal or Greece will be people holding Euros and that will happen through inflation. Inflation is relatively indirect and politicians can point fingers at each other about it while the banks and investors get out from under the loans they made to insolvent countries.

This is a long way of asking, "What's the real problem here?" Is there a real debt contagion risk? Does anyone think that the ECB or Fed, once having printed tons of money to loan to governments is ever going to grow a backbone and demand a liquidation once it becomes obvious the debts will never be repaid? Or will they instead, just forgive the debts and wash away the problem in a cataract of printed Euros and Dollars?

Tuesday, November 23, 2010

Amateur Video from North Korean Artillery Attack

Dig this.

I'll Bet Black Widow Spiders Are Drunk Half The Time

Here's a photo of one that lives right outside of our office at work.

I've read that they're indifferent web builders. This one looks like something a petulant 3rd grader would do on a homework assignment she hated. It's just a random spray of silk spattered across one corner of our window. After all, what's the point of doing a good job? All the web has to do is slow the prey down so the spider can run over and bite once. The spider is saying, "Whatever. I don't have time for this web stuff, man, I'm busy. Grab me another beer, OK?"

Monday, November 22, 2010

I Don't Know Why I Love This, But I Do

I Think Every Grilling Attempt by Young Men Involves Food on Fire and Beer

... and, oh yes, some young ladies wondering aloud if the grill is supposed to be a mass of flames. Like this.

Man, does that look familiar.

Hedgehogs Are Full of teh Awesome!

No, really.

Losers Don't Dictate Terms

... that's the only thing I can think of every time I read these kind of sentiments coming from the White House.
Nov. 20 (Bloomberg) -- President Barack Obama said countries running trade surpluses should boost domestic demand and allow their currencies to strengthen, repeating criticism he made of China a week ago at a meeting of global leaders.

“Countries with big surpluses have to figure out how they can expand demand,” Obama said today at briefing after a North Atlantic Treaty Organization summit in Lisbon. “Countries with significant deficits, we have to save more and focus not only on consumption, but also on production and exports.”
We've worshipped consumption and demonized production and now we're prostrate before our creditors, forced to print paper money to cover our debt payments. Obama and his buddies' sound like Wesley Mouch from Atlas Shrugged issuing Directive 10-289.
"In the name of the general welfare," read Wesley Mouch, "to protect the people's security, to achieve full equality and total stability, it is decreed for the duration of the national emergency..."
Everyone around the world should stop trying to make money by producing valuable things at good prices because, well, we're losing. Oh yeah, that's going to work out well. It's like the academics think that everyone else is out for "fairness" just like they are. They don't like the idea of competition and winners and losers, so they want to ban it. Instead, the Chinese and Germans are happily kicking our butts and will continue to do so.

The Obama Admnistration might be surprised to discover that the rest of the world isn't banning "touching" in their schools.

Sunday, November 21, 2010

What Budgeting Software Do You Use?

I was just about to buy Quicken 2011 when I read its reviews on Amazon. Ouch! I've used it in the past and liked it, but the reviewers are telling me it's worse, not better.

Recently, I tried out mint.com, but I didn't like it. It was great for tracking spending, but lousy for projecting future balances. Excel works OK for large-scale budgeting, but it's horrible for managing actual accounts.

Which leaves ... what? If you've got a favorite or just something you muddle along with, I'd love to hear it.

Saturday, November 20, 2010

Why the Irish Nationalized Their Banks

Blame the EU. Here's my undoubtedly inaccurate understanding of the situation:

When the Irish banks began to fail because the housing loans they made blew up on them, Ireland, naturally, sought to protect the banks' depositors. If Patrick and Erin O'Reilly's life savings in their local bank were suddenly vaporized as the bank went under, there would be mass povertyand chaos. If Ireland owned its own currency, the Irish Central Bank could print money to cover the depositors and let the banks and the investors go down the tubes. By joining the EU, Ireland lost control of the printing press and so their only option to save the O'Reilly's deposits was to nationalize the bank.

The Irish taxpayer took the place of a central bank printing press. Instead of a quick spasm of default where investors and banks would get slammed with the losses, the losses became a horde of zombies, banging at the doors and windows of the Irish worker for decades to come in the form of practically endless waves of debt servicing costs that have to be paid through their taxes.

The rescue plan being created by the EU and the IMF for the Irish does nothing more than stagger those waves of zombies. It's a series of loans that the Irish will have to pay back over decades. Chan Akya, writing in the Asia Times, claims that this feature, which will play out in Portugal, Spain, Italy and France*, dooms the EU. Even if he's wrong, the article is worth reading.

* - If France goes down the same road, then there really is nothing left of the EU.

Imports We Don't Want

Wow. The first thing I thought was, "Why isn't this just going to import the gang violence into the town next door?"

Friday, November 19, 2010

Video of the Day

Andrew Klavan rocks.

Blacks, Slavery, the 60s and Marriage

In recent posts about religion, race and marriage, there has been discussion in the comments speculating about why American blacks in particular seem to have such a hard time with marriage. Allow me to suggest an explanation.

A while back, while doing some research and reading about the breakdown of the family in the US, I wrote a post about the effects of slavery on black marriage statistics which contained this tidbit.
The muddled notions of modern feminism aside, a man’s primary role in a family is to protect and provide. Because slaves did not own the fruits of their labor and because male slaves could not protect their families from being dispersed, the man’s value in the slave family was minimal. Marriage among slaves was illegal. For these reasons and others, slave families were primarily matriarchal.

After the Civil War, Jim Crow laws as well as other societal norms similarly diluted the man’s value in the black family. Additionally, for a variety of reasons, black women outnumbered black men, which as we have seen before, depresses the number of marriages in a community.
I would argue that, in terms of marriage, blacks in America had appalling luck in the timing of their societal evolution from slaves to equals. The sexual revolution of the 60s and 70s wrecked our concept of family just when the civil rights movement was giving black men the equality they needed to properly fill the roles of father and husband in their families. Had the civil rights movement predated the sexual revolution by a generation or two, there would be no consternation today about why blacks have such a high illegitimacy rate relative to the rest of us. We'd all have been equally screwed by the destruction of societal morals in the 60s and 70s. Whites would no longer be able to draw solace from the fact that black illegitimacy statistics were worse.

It was all bad timing. Race had nothing to do with it at all.

Umm, Bob, Carol, Ted, Alice, could you come back in about 50 years? We're not ready for you just yet.

Thursday, November 18, 2010

Why Not?

There's been a terrific comment thread on my post noting that God and morality didn't play a part in Bob Herbert's column bemoaning the destruction of the black family in America*. The comments included this link showing that African-Americans are markedly more religious on a variety of measures than the U.S. population as a whole and a scholarly submission by Bradley Wright whose abstract included the following tidbit.
However, other factors, such as increased religiosity, strong family ties, and lowered alcohol consumption, decrease crime.
I've not had the time to process it all as work and family events have taken me away from the blog, but let me continue the conversation here with two examples and a question.

A long time ago, I was talking to some non-religious (white) high school chums on the phone. One of them had received a used Pontiac Trans Am as a gift from his grandmother. The car was a total lemon and he hated it. Rather than sell it for what it was worth, which was practically nothing, he gave it to some friends and claimed it was stolen to his insurance company. He pocketed the cash from the insurance company and, I presume, his friends parted out the car. The story shocked me. When I objected that this was insurance fraud, he replied, "So what? The insurance company makes lots of money. They can afford it. It's no big deal. I'm just one tiny claim to a huge company." I had no reply that could convince him what he did was wrong. We stopped being friends after that.

My second example is this: The following video is from a popular song. The YouTube page shows more than 815,000 hits. Is its message wrong? If so, how could you convince its fans that it is wrong without referencing God or objective morality? Can you use objective morality without referencing God? If so, from what do you derive your first principles? How do you avoid this?

Why not claim the Trans Am as stolen? Why not gratify yourself on the body of a girl? Why not choose hedonism and selfishness?

We've been trying to answer these questions for quite a while now and have seen nothing but failure. St. Augustine asked the question over 1600 years ago.
(W)hy did those gods (in our secular world, the government fills the role of the Roman gods), from whose worship ungrateful men are now complaining that they are prohibited, issue no laws which might have guided their devotees to a virtuous life?
Why the endless failure without God?

* - Note that the wages of sin are colorblind. In England, it is the white family that has been blown to hell and gone and the Pakistani and Indian families that are more intact.

Wednesday, November 17, 2010

Cheezburger of the Day

Playing Irish Chicken

I have to admit I only partially understand the Irish debt crisis. Apparently, the Irish property bubble burst, depressing their economy and nearly bankrupting their financial institutions. But why the big push to get the Irish to accept an IMF and EU bailout? And why the Irish reluctance? Here's a few dots to connect.

First off, the Irish have one big competitive advantage when it comes to jobs and growth. They have a very low corporate tax rate. Under a normal bailout, the EU and/or IMF could stipulate that Ireland would have to raise taxes to get the cash. Not so fast, say the Irish.
The Irish are a nation of gamblers. The country may be struggling with the burden of a huge government deficit, soaring borrowing costs and a deeply damaged banking system, but it would be dangerous to bet against Dublin winning its high-stakes game of poker with the European Union over a possible bailout.

Ireland's aim is to secure a deal on the most favorable terms, including crucially the retention of its ultralow corporate-tax rate, a potent symbol of economic sovereignty that the minority Fianna Fail government is determined to protect at all costs ahead of next year's likely elections.

Dublin still has the strongest hand. The first thing in its favor is that no one can force it to accept a bailout; Ireland has to ask the European Union for help. And given the Irish government is fully funded until the middle of next year, it can in theory drag this situation out for months. If it did that, of course, contagion would likely spread quickly across the euro zone, as Tuesday's stock and bond selloffs showed, threatening the survival of the common currency. In that sense, Ireland is armed with a nuclear weapon.
So the Irish may well end up taking the money, but on their own terms. The EU has to worry about appearances as investors are getting nervous about Spain and Portugal.
On Wednesday, Lisbon sold €750 million of 12-month Treasury bills, but paid investors a painfully-high interest rate of 4.8% compared with 3.3% earlier this month. Interest rates don’t usually jump that much in, like, two weeks.

Were it to borrow for 10 years, Portugal, a small European economy with weak growth prospects, would probably have to pay an interest rate of 6.87%, based on market prices, compared with 5.86% in early September.

Spain, Europe’s fourth-biggest economy, would have to pay 4.62% to borrow for 10 years compared with 4.06% two months ago. It will be in the market selling long-term debt on Thursday.
The longer the Irish delay, the more it looks like the EU's problems are out of control, causing more investors to take their money out of Europe. Of course, as Nouriel Roubini would probably tell you, the whole game is rigged and in the long run, what the EU fears is not a chance, but a certainty.
Spain's timid economic recovery stalled in the third quarter as government austerity measures, high unemployment and weakening exports weighed on the economy.
Short version: They borrowed too much money to blow on things they didn't need and now they've got to pay the bills. Like a family who took out credit card and home equity loans to buy jetskis and a swimming pool, the Euros spent money they didn't have on social programs that weren't investments, they were wish fulfillments. In the end, it doesn't matter whether the Irish take the bailout or not. There's nothing that's going to stop the inevitable collapse in Portugal, Spain and Italy. Borrowing from your brother to pay this month's credit card minimums just means that you declare bankruptcy a month later.

The reason the Irish have leverage over the EU is the fact that the Euros have yet to fully accept reality. Socialism has failed. Again. Sooner or later, there's going to be a very messy cleanup for having believed in it.

Even though the cliff is just 500 yards away, the EU is convinced it can stop the train in time.

Tuesday, November 16, 2010

How to Achieve Efficiencies in Your Corporate Mail Room

No Mention of God or Morality

Bob Herbert bemoans the state of the black family in his column today. It, and the comments attached to it, rightly attribute social patholigies to the destruction of the family. He and his commenters, however, have no idea how to solve the problem. Stop by his column and read through the comments. It's a glimpse into a culture of lost and wandering souls.

$600B Is Just a Drop in the Bucket

So the Fed is going to print $600B to buy Treasuries and keep interest rates down. Yay! This has to work because $600B is a lot!

$13T is more.
Bucking the Federal Reserve's efforts to push interest rates lower, investors are selling off U.S. government debt, driving rates in many cases to their highest levels in more than three months.

The Fed's $600 billion program to buy Treasury bonds began late last week and is kicking into high gear this week, with the central bank buying up tens of billions of dollars of debt.

That should have driven prices up on those bonds and lowered their interest rates, or yields, which move opposite to the price. Instead, yields on almost every Treasury have been rising.
Throughout history, other countries have discovered that trying to manipulate their currency or interest rates in a time of crisis can lead to bankruptcy. Central banks can't print enough money to overcome investor mood swings when there is a lot of debt already in the system. $600B sounds like a big number, but it's less than 5% of our total debt. If just a small percentage of our bondholders start selling, the Fed's actions will be washed away. In fact, the Fed's actions can trigger those sales.

By printing unbacked money, the Fed is devaluing the Dollar. Your Treasury holdings, denominated in Dollars, are worth less and less as the Dollar falls. Your best bet is to sell them and buy something else, something that will hold or increase its value like commodities or foreign assets. In an environment where global investors turn bearish on the Dollar and low-interest Treasuries, the Fed's $600B is puny. Instead of having the desired action - holding interest rates low - it can trigger a loss of confidence or a chance to take profits on previous Treasury purchases. The resultant sell-off leads to higher interest rates.

Instead of printing money, we'd probably be better off if we decided to create things people wanted at prices they were willing to pay. Of course, that might require us to remove some government controls.

Nahhhh. Let's just print more money.

Image from Money Tip Central.

Sunday, November 14, 2010

The Ultimate Zombie

... is a sparrow. Here's why.
  1. They can fly with great agility.

  2. They're tiny.

  3. There are lots of them. I mean lots.

  4. To kill the zombie versions, you have to shoot them in the head. Good luck with that.

  5. If they peck or scratch you, you're infected and you'll be a zombie in no time flat.

If you can see one, you're already (un)dead.

Cheezburger of the Day

Tarzan squirrel  summonz  friendz

You Gotta Love This

Saturday, November 13, 2010

Diving Bell Bobbing

For the initial trial run of my diving bell housing for my camera, my daughter and I went down to the Point Loma tidepools. The surf and the tide were up, so all we could do were run some tests of the housing, sans camera, in a sheltered part of the beach.

From the video of the experiment, I think you can see the design of the bell. It's a Mason jar glued to a 2 1/2# disc weight with two pieces of foam inside to cradle the camera. While the weight is sufficient to make the diving bell sink, the buouyancy and poor aerodynamics of the jar cause it to rock and roll when it gets hit by waves. The previous post about the Diving Bell showed that in calm conditions, it works well, so as long as I can find a calm tidepool deep enough to submerge the lens, this design should be fine.

The real solution, of course, is to ask for a Kodak Playsport for Christmas. :-)

Comment of the Week

Tom Petruno argues that California doesn't have a drinking debt problem because lots of other states are even more drunk in debt than we are.
The state's debt works out to $2,362 for every Californian, according to Moody's Investors Service. That ranks seventh among the states, well below the burdens of No. 1 Connecticut, at $4,859 per capita, and No. 3 Hawaii, at $3,996, for example.
In the comments there is this spamster advertising ... well, you'll see.
EarlDon at 9:32 PM November 12, 2010
If you need cahs (sic) immediately then answer is payday loan because The application process for payday loan is very simple. You just have to fill out and submit a simple online application form. You do not even need to give a personal visit to the lender, in order to apply (URL redacted)
Bonus material: Here are the ads Google decided to throw on that page.

Tom Petruno's defense of more borrowing by California reminds me of this Dean Martin quip: "You're not drunk if you can lie on the floor without holding on."

How Cats Drink

... can be found here, complete with video. It's a scientific explanation of the physics of how cats lap up water (or milk!). If you don't want to read the science, the videos are worth watching.

Friday, November 12, 2010

The Diving Bell's Maiden Voyage

Maiden Immersion?

I don't have time right now to edit the full video, but here is a tiny tidbit taken in the calm waters of Mission Bay.

Here's what I learned:
  1. The diving bell is water tight.

  2. The glass did not distort the image. You can tell that when the lens is above the water.

  3. The murkiness of the water makes the thing look out of focus when submerged.

  4. Mission Bay is boring.

  5. It was fun to do this.

More later.

A Little More on the Diving Bell Camera

Background here.

I've got a Mason jar glued to a small weight and the foam packing cut. All I need to do now is go out and start filming. I'm hoping to do that today. Here's a little science background for the effort.

How much light can you expect at depth?

It depends on the color. At 2m (6'), you get about 80% of the blues and 20% of the reds.

What's all this nonsense about wavelengths?

Here's a handy graphic that shows the relationships.

The glass of the Mason jar will distort things. This sounds like a silly idea.

It is. Kodak, the maker of my wonderful Zi8 video camera also makes a Playsport that can go down to 10'. Want. Until I get one, however, the Mason jar will have to do.

Video tomorrow? I hope!

I Think Cher Forgot Her Pants

How embarassing! I think the Vanity Fair photographer should have found someone to loan her a pair before shooting the cover photo.

Thursday, November 11, 2010

Happy Veterans Day To My Favorite Hot Rod Pilot

... my dad. Here was the kind of plane he flew in Korea, much to the commies' discomfort.

Love you, Dad.

Jerry Brown Will Be The High Water Mark Of American Progressives

... because there's nowhere to go but down from here. Dig this.
If the Government confiscated everything, the social programs would still be $50 trillion short and the Government would still be bankrupt. Furthermore, no company or individual would be left with anything
At that link, Monty Pelerin gives the gory details on all of our unfunded social program obligations. I'm not going to recapitulate them here, but suffice it to say that the mathematics of giving what the social progressives have already promised don't work out. Not even a tiny bit.

Our social safety net is going to fall apart no matter what. There will be no more promises, no more programs, no more guilt-induced voting for new benefits. It's all over. The tipping point was the Fed printing $600B to keep the checks coming. That aftershocks from that have yet to be felt as foreign governments decide what to do about the Dollar. In any case, all of the progressives' plans for government investments are over and done with in terms of actually being applied.

Two years from now, no matter what the new Congress does, our government will be spending less. They'll have to, because their debt servicing costs will be higher and programs like Social Security will be selling Treasuries rather than buying them.

It was a nice run while it lasted, but it's over now. Jerry Brown's California is going to be the show to watch as the government contraction unfolds. He's going to be the last of his kind - the big-government progressive who actually wins a meaningful office.

Godspeed, Jerry.

Skipping Out On Our Test

While reading this piece by Monty Pelerin at the American Thinker about the Fed's decision to print another $600B to buy Treasuries, it dawned on me that we don't really know if this level of deficit spending by the Federal government could be funded without the printed money. Here's what triggered my thoughts, emphasis mine.
If the Fed does not buy government bonds (print money), checks will stop for programs like Social Security, Medicare and Medicaid reimbursements, military pay, etc.
The Madoff Model of government just ended. There are no longer enough bond buyers or taxpayers to pay for the profligate spending of the US government.
Last year, the Fed printed more than $1T to finance the Federal government. This year it printed $600B. We don't really know if, absent this printed money, we could have found the cash to pay our bills. The money would have had to come from somewhere in order for the government to spend it. Since we skipped out on testing our creditors' appetites for more debt, we can't say whether or not our continuing monster deficits could be paid with anything other than printed money.

It's obvious from the chart above that China has had no recent appetite for our debt. Over the last year, they were a net seller of Treasuries. While the graph is labeled "Bouncing Back," it's really misleading. During the time frame of this chart, American debt grew by about $1.4T. In the net, China bought none of it. (Source: CNN Money)

Wednesday, November 10, 2010

Good Lord, I'm Getting Old

I know who Ratt* is and my contemporaries are beginning to worry about cholesterol.

This, apparently, is known as Butt Rock.

* - Incidentally, Ratt is just about the only 80s metal band that I really wanted to see in concert, but never did. Dio, Judas Priest, Iron Maiden, Poison, Dokken, and many others yes. Ratt, sadly, no.

Cause and Effect


Lots of new regulations whose interpretation by the bureaucracies is still unknown.


There is fear among those who hire. Click on it for a better image and dig what happens to the light grey line, fear of regulations under Obama.

H/T: Mish's link to the November NFIB Small Business Trends Report. Mish is emphasizing that inflation is not a threat in his post, hence the highlighting of that aspect of the chart. Not shown in this chart is sales, which Mish shows in another chart at that link. Sales is still the #1 issue for small business, but regulations are no small part of their concerns.

Print all the money you want, it will have very little effect on what is keeping small businesses from expanding and hiring.

Is It Posturing Or Is It Real?

The problem with any announcement that comes from China is that no matter where it comes from, it comes from the government.
Nov. 10 (Bloomberg) -- China’s Dagong Global Credit Rating Co. reduced its credit rating for the U.S. to A+ from AA, citing a deteriorating intent and ability to repay debt obligations after the Federal Reserve announced more monetary easing.

The credit outlook for the U.S. is “negative,” as the Fed’s plan to buy government debt will erode the value of the dollar and “entirely encroaches” on the interests of creditors, analysts at Dagong, one of China’s three largest ratings companies, said in a statement.
Even if the intent behind the statement was purely punitive, a retaliation for the Fed devaluing the Dollar which forces China to devalue the Yuan, other countries and ratings agencies will have to act as if it was at least partially real.

Alternatively, the statement could be 100% real and the beginning of ratings downgrades across the world. If that happens, the interest rates demanded by investors will rise to the point that the only entity willing to buy Treasuries at current rates will be the Fed. If it comes to that, $600B will only be a downpayment.

Tuesday, November 09, 2010

Second Link of the Day

This is full of teh awesome!

Sarah Palin Shreds WSJ Reporter For Not Being Able To Read His Own Paper

Har har har har har!

Redistribution at an International Scale

What does this sound like to you?
Obama indicated that he would be pushing for radical changes in Seoul, saying that "We can't continue in a situation in which some countries are maintaining massive surpluses and other countries are maintaining massive deficits."

America is running a huge trade deficit against the rest of the world, with the gap between imports and exports reaching $46.3bn last month. Its trade gap with China alone hit $28bn last month.
Doesn't it sound a lot like this?
"We’re not, we’re not trying to push financial reform because we begrudge success that’s fairly earned. I mean, I do think at a certain point you’ve made enough money."
It looks like a completely consistent world view. We want equality of outcome, whether it's personal, corporate or international. Germany and China and Exxon and Microsoft have made too much money. Now they need to pay their fair share and help the less fortunate*. So just how is this working?
German Finance Minister Wolfgang Schäuble lashed out at U.S. pressure on Berlin to rein in the country's surging exports, telling Der Spiegel magazine, "The American growth model...is stuck in a deep crisis."

He said, "It doesn't add up when the Americans accuse the Chinese of currency manipulation and then, with the help of their central bank's printing presses, artificially lower the value of the dollar."
The lecture from America's College Administrator-in-Chief is getting old.

* - It's telling that Obama, who doesn't believe in American exceptionalism in the first place, implies that the US is among the "less fortunate."

Link of the Day

B-Daddy has posted a darkly funny video on how hard it is to start a business these days. The Pac-Man segment is worth the whole thing.

Monday, November 08, 2010

Quiz Show Journalism

Over at our Monastery of Miscellaneous Musings, Dean has posted a video (which I confess I watched a few days earlier) where the Reason Magazine team makes fun of the ignorance of the John Stewart rally crowd. It's all about how they can't tell the difference between "Kenyan" and "Keynesian". Har har har. This weekend, while reading Bradley Wright's Christians Are Hate-Filled Hypocrites...and Other Lies You've Been Told, I came across a section where a journalist claimed that Christians didn't know the Bible because he went to the beach and asked a bunch of them questions about it that they couldn't answer correctly.

A whole book could be written about the insipid trivia quiz show that is the relationship between Sarah Palin and the press.

Who cares? Who cares if evangelicals can't tell you the difference between Numbers and Judges? Who cares if John Stewarts' fans know who John Maynard Keynes was? And why is Sarah Palin stupid because she isn't going to win on Jeopardy!?

People know what they need to know. As a Catholic who participates in Church activities and goes to Mass every week, I'm not sitting in the Catican every morning cramming for an exam that's going to be given to me by some journalist while I take a walk around Mission Bay. The John Stewart ralliers shouldn't have been expected to have prepped for the event with a group study session on economics.

Journalist taking notes
"Let's see here. They don't know who was the mother of Miriam and they can't tell me the number of years between the writing of Deuteronomy and Proverbs. Yep. Just what I expected. Christians are ignorant."

Image by Quinn Dombrowski, used under its Creative Commons license.

Sunday, November 07, 2010


... in inky darkness. I think it's worth a click.

India Thanks Ben Bernanke

The money quote is around 0:40-1:00.

If you hate people who make money, the people who make money will send their money somewhere else.

Pumping Money into the Economy

... but whose economy?

We just decided to print $600B of paper money to buy Federal debt. Doing so lowers interest rates and the thought is that these low interest rates will tempt businesses to borrow and expand. But expand where? Richard W. Fisher, President and Chief Executive Officer of the Federal Reserve Bank of Dallas, gave a talk at the Economic Club of Minnesota with these tidbits included:
Yet, my soundings among those who actually do the work of creating sustainable jobs and making productive capital investments ― private businesses big and small ― indicate that few are willing to commit to expanding U.S. payrolls or to undertaking significant commitments to expand capital expenditures in the U.S. other than in areas that enhance productivity of the current workforce. Without exception, all the business leaders I interview cite nonmonetary factors ― fiscal policy and regulatory constraints or, worse, uncertainty going forward ― and better opportunities for earning a return on investment elsewhere as inhibiting their willingness to commit to expansion in the U.S. As the CEO of one medium-sized business put it to me shortly before the last FOMC, “Part of it is uncertainty: We just don’t know what the new regulations [sic] like health care are going to cost and what the new rules will be."
So investing in the US with its mountains of regulations that no one can decipher is a risky scheme. Why not invest outside of the US instead?
In my darkest moments I have begun to wonder if the monetary accommodation we have already engineered might even be working in the wrong places. Far too many of the large corporations I survey that are committing to fixed investment report that the most effective way to deploy cheap money raised in the current bond markets or in the form of loans from banks, beyond buying in stock or expanding dividends, is to invest it abroad where taxes are lower and governments are more eager to please. This would not be of concern if foreign direct investment in the U.S. were offsetting this impulse. This year, however, net direct investment in the U.S. has been running at a pace that would exceed minus $200 billion, meaning outflows of foreign direct investment are exceeding inflows by a healthy margin.
And there you have it. We print gobs of money and where does it go? China, Brazil, India, anywhere but here. We've made it so painful to build businesses in the US that they're taking the money and going elsewhere.

Here, a member of Barack Obama's administration shows how piles of new regulations quickly and easily turn off the flow of investment in the US. No matter how much pressure Ben Bernanke puts into the system with his new money, it doesn't get through and it flows elsewhere.

Saturday, November 06, 2010

Cheezburger of the Day

Permanent respect for cats  in 3.....2.....1

Ben Bernanke, Invertebrate

Ben Bernanke's Fed just bailed out Congress and the President by deciding to buy half of their $1.2T+ deficit for the year with printed money. And in exchange for this, he got ... nothing. He didn't even demand a budget. The US has no budget this year, by the way. None. They didn't even bother to begin to debate one, not even in the subcommittees. They're just spending without a plan.

Bernanke asked for nothing. He just printed the money Washington needed.

Ben Bernanke, invertebrate.

Friday, November 05, 2010

Money Isn't Everything

I've been clicking around the Interweb Tubes today, reading various viewpoints on the Fed's decision to print $600B and buy Treasuries. No one has brought our growth in regulations into the picture, but their thorough knowledge of interest rates, taxes and money supply got me to thinking. We don't even think in terms of building things any more. All we think about and discuss is money.

Most economic analysis is written from a banker's point of view. Nothing I've read is written from a business owner's point of view. It's as if we don't understand how one starts a business. As long as you can get a loan, it's all easy from there on out, right?

We've made borrowing money almost as easy as it can possibly be and still nothing is happening. Our impulse is to make it even easier to borrow money.

Money isn't everything.

How California and New York Might Yet Escape

... the same way the Feds are escaping.

California and New York both have massive fiscal problems. They both elected progressives to run their states, people who won't want to slash state employee union pensions or eliminate entitlement programs. California in particular is quickly running out of ways to raise taxes. It looks like they've painted themselves into a very tight corner. But have they?

Fed Chairman Ben Bernanke recently announced a plan to buy $600B of US Treasury bonds, essentially funding about 1/2 of the deficit with paper money. His rationale was that unemployment was still too high and the dangers of deflation were too great. Well, California's unemployment rate of 12.3% is just about the highest in the nation. Why doesn't his rationale work at the state level, too?

Before Tuesday's donkey slaughter, California and New York could at least hope to convince Congress to bail them out with another stimulus bill. That's impossible now. It seems to me that their only remaining option for rescue rests with Ben Bernanke.

QE 2a, anyone?

Thursday, November 04, 2010

Why The Fed Is Pushing On A Rope

Yesterday, the Fed announced that it would print $600B of unbacked, paper money to buy Treasuries. Here's Fed Chairman Ben Bernanke's rationale for the move.
The Federal Reserve's objectives - its dual mandate, set by Congress - are to promote a high level of employment and low, stable inflation. Unfortunately, the job market remains quite weak; the national unemployment rate is nearly 10 percent, a large number of people can find only part-time work, and a substantial fraction of the unemployed have been out of work six months or longer.
What if interest rates are a second- or third-order cause of unemployment? What if taxes, finances and spending weren't the sole foundation of the economy? What if there was something else at work? Something like ... The Federal Register.

Image source: Casey's Charts.

The Federal Register (browsable back to 1998 at that link) is the list of all Federal regulations. Over at regulations.gov, you can browse them by topic area. Here's a good example of one.

On August 8, 2007, the Department of Agriculture released a 52 page set of regulations telling all farmers how to do mandatory livestock reporting. Here is a one-paragraph-out-of-52-pages excerpt:
Section 59.202 discusses the daily reporting requirements for barrows and gilts including what information would be reported, when it would be reported, and when it would be published. For barrows and gilts, packers required to report under this rule would report the details of their barrows and gilts purchases three times each day including a prior day report not later than 7 a.m. central time, a morning report not later than 10 a.m. central time, and an afternoon report not later than 2 p.m. central time, including all covered transactions made up to within one half hour of each specified reporting time. Packers completing transactions during the one half hour prior to the previous reporting time would report those transactions at the next prescribed reporting time. This information would be published by the Secretary each reporting day not later than 8 a.m. central time, 11 a.m. central time, and 3 p.m. central time, respectively. For barrows and gilts, packers required to report under this rule would also have to report not later than 9 a.m. central time on each reporting day information regarding all barrow and gilts slaughtered during the prior business day.
That's one paragraph from Part 59 of the Federal regulations on agriculture. Each state then adds its own regulations.

Creating jobs will require starting new businesses. People who start their own companies are extraordinary people. Most already have jobs or can find ones working for someone else. If starting a business means obeying a rapidly growing mountain of regulations like the one above why would you bother? When choosing between obeying all of these rules and regulations, which you can't hope to understand or even remember, or picking up a paycheck working for someone else, will slightly lower interest rates make much of a difference?

What do we get when we print money to fight a problem that isn't amenable to more money?

Wednesday, November 03, 2010

Election Results

The two best sites I found this morning discussing the election results are this post on Red State discussing the historic gains by the Republicans and this interactive map at Politico.

Meanwhile, California has jumped into the Abyss, electing Jerry Brown and handing him and our infantile liberal legislature, with the approval of Proposition 25, the ability smash what's left of the state's economy. With the disapporval of Proposition 23, we've also decided to fight global warming with our W-2s. Those of you outside of California ought to get a big kick out of watching our smug, self-righteous faces sneer at you as a parade of corporate moving vans head east on I-10.

If you've been following my posts on the governor's race and were wondering, I voted for Meg Whitman as did everyone else in our house.

Tuesday, November 02, 2010

Pointless Printing

On Wednesday, we'll know for sure. No, not the election results, but the level of dollar printing from the Fed.
Nov. 2 (Bloomberg) -- The Federal Reserve will probably introduce an unprecedented second round of unconventional monetary easing tomorrow by announcing a plan to buy at least $500 billion of long-term securities, according to economists surveyed by Bloomberg News.
What's the plan here? What's the model we're following? After we print $500B of meaningless paper and use it to buy government debt, we will ... what?

At least with the stimulus bill, they used economic models to predict the future. No matter how much you disagree with the Obama Administration, they did their best to have an intellectual foundation to their actions. That it turned out to be nonsense isn't a bad thing unless we don't learn from it. As far as the Fed printing money goes, I have yet to find any long-term planning in it. We're just replacing borrow-and-spend with print-and-spend and hoping for the best.

"John? John Maynard Keynes? Is that you?"

Monday, November 01, 2010

Two Reasons to Really Vote for Meg Whitman

I've written a pair of semi-apocryphal posts recently about how I was going to vote for Jerry Brown. There are two reasons not to do this. First, as Secular Apostate and Argentina both show us, there is no guarantee that a failed political philosophy will be recognized as such. SA left this comment on my last Jerry Brown post:
A mindset exists that is incapable of shifting to "OMG, we've gone too far!" One need only look at Detroit or read Paul Krugman to know that for some people, the only response to failure is to double down on the precise policy choices that caused the failure in the first place. To quote Joe Biden, “Now, people when I say that look at me and say, ‘What are you talking about, Joe? You’re telling me we have to go spend money to keep from going bankrupt?’ The answer is yes, that's what I’m telling you.”

The Self-Immolation Syndrome is not going to get cured at the ballot box in California anytime in the foreseeable future.
Argentina shows something similar. Despite the failure of Justicialism, the Peron-Obama fascism in support of economic redistribution, the people of Argentina continue to elect Peronists. Sometimes even spanking doesn't work as an instructional tool.

The second reason to vote for Meg is this: if we elect Jerry Brown and vote yes on Prop 25, people are going to lose their houses in droves. Proposition 13 is the only thing keeping the state from endlessly raising property taxes, which used to be their favorite way to soak the rich and fund the parasites in Sacramento. That's just too high of a price to pay in exchange for a probable failure to instruct the childish progressives of California.

Seriously. Vote for Meg.

Being a Hood Ornament

... is hard work. Our Maximum Leader is doing it so you don't have to.